Google's parent company, Alphabet, announces massive profits despite $2.74bn fine

Muriel Hammond
July 25, 2017

The aggregate cost per click for the quarter fell 23%, compared with a year ago.

Alphabet logged a 21-percent surge in revenue for its latest quarter, taking it to combined sales of $26 billion (22.3 billion euros). Cost of revenue-which Alphabet uses to describe running costs before capital expenditure on things like research, rose 28%, increasing faster than top-line growth. "The growth remains very impressive for a company this size".

Alphabet took in $248 million in revenue and posted a narrowed loss of $772 million in its "other bets" category in the recently ended quarter. Paid clicks on Google Network Members' properties increased 9% year over year.

Traffic acquisition costs came in at $3 billion. Also, CEO Sundar Pichai sold 4,000 shares of the firm's stock in a transaction that occurred on Wednesday, April 19th. "We're just really pleased with the strength of our mobile business". Although the numbers would have accounted for a profitable quarter, a hefty fine paid to the European Union in charges related to anti-trust issues; the company reported a net loss or downfall of its revenue in the three months from April and June.

Analysts expect Google's share of the digital advertising market to remain relatively stagnant over the next few years. The company has to share more of the money from those ads than it does with its original web search marketing slots. This will likely drive more than a few ad directors insane. This shows that companies paid much lesser to advertise on #Google than they previously used to.


Investors might also have focused on another EU investigations into competition concerns over its Android operating system and new European privacy laws that could hurt its advertising businesses. Alphabet makes up approximately 5.4% of Trinity Street Asset Management LLP's investment portfolio, making the stock its 10th largest position.

As of last month, many major companies, including Wal-Mart Stores Inc., AT&T Inc., and J.P. Morgan Chase & Co., still hadn't resumed spending on YouTube ads. Google is likely showing more ads on reputable websites as a result, which charge more to host Google's ads than lesser-known sites, he said.

According to Google CEO Sundar Pichai, 1.5 billion people visit YouTube each month, with each spending an average of 60 minutes a day watching its videos.

Porat said Alphabet was reviewing its options and declined to comment further on the ongoing legal matter. Alphabet competes heavily in the fast-growing cloud business with tech companies Amazon.com Inc and Microsoft Corp. In the second quarter, for example, this unit had 99 percent of the company's total $26 billion of revenue and operating margins of 30 percent.

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